Can/does an employer check your credit score?

A coworker was complaining the he got skipped over for a promotion, and said he should have been picked because he probably had a higher credit score than the other guy. What? Can an employer (or perspective employer) look at your credit report? Why would they? If they can, could that be considered discrimination (I don’t know, “economic discrimination?”) if they base their choice on it?

It doesn’t take much to check a credit score. I think a name and social security number is sufficient. In the past, landlords have checked my credit score when leasing an apartment.

Many companies do background checks when hiring employees and contractors. It would be possible for those background checks to include a credit score check but I don’t know if this is normally done or if it would be legal.

Many employers will run a credit check before hiring you if you’d be hired into a position where you deal with money, but I’ve never heard of it being used after hiring, especially not for something like a promotion.

Sure it would be discrimination, but not illegal discrimination. :rolleyes:

Why is it that most people think that all discrimination is illegal?

I’m sure if you found the right lawyer or talked to the ACLU they could be sure it was done illegaly. And I second your :rolleyes:

When I worked at Fidelity Investments in the late 90s, they did indeed check my credit history prior to employment. It was a bit dodgy back then, and they actually made my employment offer contingent on clearing up a couple ‘blemishes’, i.e. paying the debts.

Employers discriminate everyday, and rightfully so. Just because you don’t like it, doesn’t make it illegal. Finding the right lawyer, would have nothing to do with it. Finding the right judge however, might be a different story.

You’d be wrong.

Yeah, I guess when you hire someone to work in a bank it would make sense to check if they have a huge debt that they might be trying to pay off customer by customer . . .

Can they do that without asking, or do they slip in a paper saying they can when you are signing everything when you are hired?

For a few years, my husband worked for the Maryland state government, in the dept. of corrections. Even though he was a computer engineer (not a guard or something), they ran a credit check on him before hiring him. This, they said, was because he’d be in regular contact with criminals/prisoners, and if he had serious financial problems, it would make him high risk for the ‘undesirables’ to bribe him.

i work a credit union, and we do a credit check before hiring. We want to know if you are unable to manage your money, or if you have perennial issues, or if you might have a need to embezzle.

As far as I know, once you’re hired, a credit check is not part of our normal promotion process. I could see one being run as part of an investigation into a particular issue, though.

We check the credit of all external job applicants and rule out all with a score below a certain number I shan’t discuss. The same is not true of internal applicants.

I disagree with the former policy, but it’s not my call.

In my state, at least, the consent of the person being checked is required. If an applicant does not check the box on the application agreeing to the check, the application is not done, unless a sufficiently high-ranking person says, “Oh, screw that shit.” But persons for whom that happens don’t have to go through the ordinary process anyway.

Because they don’t understand what the word discrimination means, I expect.

Illinois recently passed a law that took effect January 1, 2011.

It makes it unlawful for an employer to check a new applicant’s credit score or an existing employee’s score.


There are about 20 exceptions to this law that render most of it ineffective. The biggest problem is that employers had six months of advance notice to check current employees

You can check with the Employee Credit Privacy Act to see the list of exceptions

So you really have to check with your state labor dept to see what’s going on.

It depends on the laws of the individual states. In many (most?) states in the US it’s legal to run a credit check for employment.

From what little research I can find it is generally required that an employee give written consent to a credit check before credit history can be obtained.

Yes, potential employers can and do sometimes look at people’s credit history before hiring and sometimes promoting people. Usually, this is for people who are being hired to positions of power over budget and other areas where large amounts of money are handled. The idea is that if someone is in financial trouble, they might be tempted to do things in order to help get themselves out of debt rather than look out after the company’s best interest. Whether this is true or should be allowed is a matter of great debate.

However, your coworker thinks he should have been promoted simply because he has the higher credit score?

Maybe your friend wasn’t promoted because his judgement is suspect. For example, he thinks people should be promoted because they have a higher credit score rather than because they are competent and hard working.

If you want to work in the (US) Federal sector in a position requiring a national security clearance, a credit check is not only mandatory, but also a great way to see if they’ve started the background. You do have to sign a form granting them permission to do so (as well as a form granting permission for them to research medical, mental health, and other records, as well). I think this is fair and appropriate.

Anecdote: When I was working for a Federal agency a few years back (DoD was conducting my background while I was on a waiver with a Secret clearance, pending my Top Secret), I had applied for a position with the agency with which I was contracted at the time. Both required a credit check, and both ultimately required a TS. One day, walking down the hall at work, our recruiter mentioned that he was growing impatient about my BI and asked me to pull my own credit report to make sure that the agency had checked my credit. Last credit pull had been done by DoD… as it turns out, there’s seems to be a rule against running multiple national security BIs simultaneously. DoD had kind of stalled on theirs, and when the agency I worked for started theirs, they saw a simultaneous investigation and halted theirs. So they were both delayed… by like a f’ing year. Grumble, grumble, bureaucracy.

Not sure what the laws are state to state, but I’ve had this done (without my knowledge) at an executive level job I was eventually hired for. **qazwart **may have it right in that they only do this for certain levels. I don’t know. I do know that I had to sign a waiver giving then the right to do this if they so desired, but I never thought they’d actually do it.

Not signing it may have been the red flag they needed to pass on me as a candidate. In this area, I never had anything to worry about and gave them the permission. Which, if I remember correctly included only a short window of time that they had access to the info…

What I’ve never been able to find out is it, do employees have permission to check to see if their credit check was run by their employer and for what purpose?

Hey I learned something new today. When your credit report is pulled by a potential employer it is called a “soft inquiry” and probably won’t even show up. So you might not know about it, but no one else will either so it doesn’t affect your credit score. The ones that do show up (and do affect your credit score) are the ones that happen when you apply for a loan or credit card. Hopefully you will recognize why they happened when you see them. If not you should probably ask about it.